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Kutak Rock served as underwriters’ counsel in connection with the Sales Tax Securitization Corporation’ s $376,305,000 Sales Tax Securitization Bonds Series 2018A and $303,975,000 Sales Tax Securitization Bonds Series 2018B. The Corporation is a special purpose, bankruptcy-remote not-for-profit corporation that purchased all of the City of Chicago’s rights in and to its sales tax revenues.

While Chicago's own general obligation ratings range from low/junk to the high triple-B category, the Sales Tax Securitization Corporation's paper carries an AA rating from S&P Global Ratings and AAA ratings from Fitch Ratings and Kroll Bond Rating Agency. All assign a stable outlook. The city, which previously postponed an $898 million tax-exempt bond issue by the corporation, restructured the deal to include about $300 million of taxable bonds.

The pricing of nearly $376.3 million of the city’s Sales Tax Securitization Corporation tax-exempt bonds resulted in spreads of 53 to 60 basis points over Municipal Market Data’s benchmark triple-A yield scale. In the opinion of several market participants, Chicago’s downsized and refashioned sales tax securitization may fare better than the original deal that was previously delayed.

“Kutak Rock has a deep relationship with the City of Chicago,” says Lance Tyson lead attorney and partner in the firm’s Chicago office. “We needed to tap into many firm strengths in order to zealously represent the bond purchasers. It’s such a good feeling to know you were a part of saving the tax payers of the City of Chicago millions, ” he said.

Kutak Rock public finance and tax attorneys included Lance Tyson, Dennis Holsapple, Deborah Boye and Matthias Edrich and municipal bankruptcy attorneys included Thomas Roubidoux and Bruce Wilson who collectively served as underwriter's counsel in connection with the transaction.

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